Darshan Singh, Rajpura V. ITO, Rajpura

ITA 918/CHANDI/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 8383 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 4 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-03-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 29-07-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 30-10-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH,CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA NO. 918/CHD/2014 ASSESSMENT YEAR: 2008-09 SHRI DARSHAN SINGH, VS THE ITO, S/O SHRI SURMUKH SINGH, WARD, VPO BASANTPURA, RAJPURA. TEHSIL RAJPURA. PAN: ATZPS5936R (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI DEEPAK AGGARWA L RESPONDENT BY : SHRI S.K. MITTAL DATE OF HEARING : 24.02.2016 DATE OF PRONOUNCEMENT : 01.03.2016 O R D E R THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF LD. CIT(APPEALS) PATIALA DATED 29.08.2 014 FOR ASSESSMENT YEAR 2008-09 CHALLENGING THE LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE INCOME TAX A CT. 2. THE FACTS OF THE CASE ARE THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAS EARNED SHORT TERM CAPITAL GAI N AMOUNTING TO RS. 81,449/- WHICH HAS NOT BEEN DECLAR ED IN THE RETURN OF INCOME. IT WAS ALSO NOTICED THAT THERE WERE CASH DEPOSITS ENTRIES AMOUNTING TO RS. 8 LACS. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE SUBMITTED CASH-FLOW STATEMENT AND CONTENDE D THAT THE SOURCE OF THIS MONEY IS AGRICULTURAL INCOM E. 2 HOWEVER, NO EVIDENCE IN THIS CONNECTION WAS FILED. THE ASSESSING OFFICER, THEREFORE, MADE BOTH THE ADDITIO NS AGAINST THE ASSESSEE AND INITIATED THE PENALTY PROCEEDINGS FOR CONCEALMENT OF ITS INCOME. VIDE SEPARATE ORDER, PENALTY WAS IMPOSED. THE ASSESSEE CONTENDED IN THE PENALTY PROCEEDINGS THAT ASSESSEE AGREED FOR ADDITION TO BUY PEACE OF MIND AND TO AVO ID LITIGATION. IT WAS ALSO SUBMITTED THAT FATHER OF T HE ASSESSEE WAS RUNNING A SMALL CLOTH SHOP FOR THE LAS T 35 YEARS AND WAS AN AGRICULTURIST. FAMILY SOURCE OF I NCOME HAD BEEN FROM TUITION WORK OF THE ASSESSEE, HIS AND FATHERS CLOTH SHOP WHICH HAVE BEEN CLOSED DOWN AND AGRICULTURE INCOME. THE ASSESSEE, THEREFORE, SUBMI TTED THAT NO UNDISCLOSED INCOME COULD BE EARNED BY ASSESSEE. IT WAS ADMITTED THAT NO BOOKS OF ACCOUNT HAVE BEEN MAINTAINED FOR THE SHOP. 3. THE LD. CIT(APPEALS), CONSIDERING THE FACTS OF T HE CASE, HELD THAT THE ASSESSEE COULD NOT SUBSTANTIATE THE SOURCE OF DEPOSIT OF RS. 8 LACS IN HIS BANK ACCOUNT BY WAY OF COGENT EVIDENCE. FURTHER, SHORT TERM CAPITA L GAIN WAS ALSO NOT DISCLOSED IN THE RETURN OF INCOME. TH E LD. CIT(APPEALS) FOLLOWING THE DECISION OF HON'BLE SUPR EME COURT IN THE CASE OF DHARMENDRA TEXTILE PROCESSORS 306 ITR 277 CONFIRMED THE LEVY OF PENALTY AND DISMISSED APPEAL OF THE ASSESSEE. 4. I HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PARTIES AND PERUSED THE FINDINGS OF AUTHORITIES BEL OW. 3 THE LD. COUNSEL FOR THE ASSESSEE CONTENDED THAT ASSESSING OFFICER HAS NOT GIVEN ANY FINDING THAT ASSESSEE EARNED ANY REAL INCOME, THEREFORE, NO PENA LTY IS LEVIABLE AND RELIED UPON DECISION OF MADRAS HIGH COURT IN THE CASE OF ROHINI DAIRY FARMVS CIT 244 IT R 427. ON CONSIDERATION OF THE RIVAL SUBMISSIONS, I AM NOT INCLINED TO ACCEPT THE CONTENTION OF LD. COUNSE L FOR THE ASSESSEE. IT IS WELL SETTLED LAW THAT PENALTY IS TO BE CONSIDERED IN THE LIGHT OF FACTS DISCLOSED IN THE O RIGINAL RETURN OF INCOME. THE ASSESSEE FILED RETURN OF INC OME AT RS.91,868/- DECLARING THE SOURCE OF INCOME FROM PRO FITS AND GAINS FROM BUSINESS. THE ASSESSEE HAS NOT DECL ARED SHORT TERM CAPITAL GAIN OF RS. 81,449/- IN THE RETU RN OF INCOME. SIMILARLY, IT WAS FOUND THAT ASSESSEE HAS MADE CASH DEPOSITS IN HIS BANK AMOUNTING TO RS. 8 LACS, FOR WHICH SOURCE IS NOT EXPLAINED. THE ASSESSEE ACCEPT ED THE ASSESSMENT ORDER AND NO FURTHER APPEAL HAVE BEE N FILED. THEREFORE, IT IS A CLEAR-CUT CASE OF CONCEAL MENT OF INCOME BECAUSE THESE FACTS WERE NOT DISCLOSED IN TH E ORIGINAL RETURN OF INCOME FILED BY THE ASSESSEE. T HE CRUX OF THE FINDINGS OF THE ASSESSING OFFICER, THER EFORE, CLEARLY DISCLOSE THAT THE ADDITIONS FOR WHICH PENAL TY WAS IMPOSED, WERE REAL INCOME OF THE ASSESSEE WHICH WER E CONCEALED FROM THE REVENUE DEPARTMENT. THE ASSESSE E MERELY PLEADED BEFORE THE ASSESSING OFFICER IN THE PENALTY PROCEEDINGS THAT THESE ADDITIONS WERE AGREE D BY ASSESSEE TO BUY PEACE OF MIND AND TO AVOID LITIGATI ON. THESE SUBMISSIONS ARE NO MORE APPLICABLE TO THE PEN ALTY 4 PROCEEDINGS IN VIEW OF THE JUDGEMENT OF THE HON'BLE SUPREME COURT IN THE CASE OF MAC DATA PVT. LTD. 358 ITR 593. SINCE THE ASSESSEE DID NOT DECLARE SHORT TERM CAPITAL GAIN IN THE RETURN OF INCOME AND FAILED TO SUBSTANTIATE THE SOURCE OF CASH DEPOSIT IN THE BANK ACCOUNT, THEREFORE, EXPLANATION-I TO SECTION 271(1) (C) OF THE ACT IS CLEARLY APPLICABLE AGAINST THE ASSESSEE AND LEVY OF THE PENALTY IS JUSTIFIED IN THE FACTS AND CIRCUMSTANCES OF THE CASE. I DO NOT FIND ANY MERIT IN THE APPEAL OF THE ASSESSEE BECAUSE NO ERROR HAVE BE EN POINTED OUT IN THE ORDER. THE DECISION RELIED UPON BY ASSESSEE WOULD NOT SUPPORT THE CASE OF THE ASSESSEE BECAUSE IN THIS CASE, THE PETITION OF THE ASSESSEE WAS DISMISSED. 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DATED: 1 ST MARCH, 2016. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR ASSISTANT REGISTRAR, ITAT/CHD